When can a bank change the loan interest rate?

A change in the interest rate on the loan must be made by the bank in accordance with the law. Borrowers must bear this in mind when taking out a loan with a floating interest rate. All terms of the change should be described in the loan agreement.


Pursuant to the law and the signed credit agreement for a loan with a variable interest rate, the bank may modify the interest rate on such liability at any time, but based on changes in the base rate. 


The loan agreement is the most important

The loan agreement is the most important


All credit conditions, including assumptions regarding a possible change in the interest rate of the loan , must be indicated by the bank in the loan agreement. It is the borrower’s responsibility to look after its content to help it avoid unexpected costs. You can always question the terms offered by the borrower’s bank and negotiate them. However, after signing the contract, its provisions become effective, as long as they are legal.

The bank has the option of changing the loan interest rate at any time during the term of the loan agreement. However, he cannot do it by any means.


The interest rate on loans in the country is the sum of the bank’s margin and the base rate in the relevant period. For example, in the case of mortgage loans it is usually interest rate. The bank may change the interest rate on a loan or borrowing if there is a change in the base rate, and it is in turn affected by any change in the interest rates of the National Bank of the country, which is determined by the Monetary Policy Council.

When the index increases, the total cost of credit also increases, and the borrower should be prepared to increase the amount of monthly loan installments.


The credit agreement should include information on how many percentage points the rate must change in order for the loan interest rate to change.


Credit agreements with a fixed interest rate

Credit agreements with a fixed interest rate


In case of signing by banks and customers contracts for loans with a fixed interest rate, a lender can not change the interest rate during the credit period. Therefore, the customer can be calm about the interest rate on the liability in the time specified in the contract. It will not necessarily apply throughout the entire contract. This must be checked in the conditions offered by the borrower’s bank.

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